ILLUSTRATION:^ JOE^WALDRONSTART
he years living in the looming
shadow of Brexit have, against the odds,
been a golden period for UK tech. We’ve
witnessed multibillion-dollar exits –
including Zoopla’s and Farfetch’s – and
VC funding at record highs, with about
£2.6bn deployed in the UK in the first two
quarters of 2018 alone. If the UK finally
leaves the EU, that’s not going to change- even though Brexit will mean a shift
in emphasis for the sector as a whole.
There are some reasons for optimism.
A technology startup’s success always
depends on three crucial ingredients:
access to capital, access to talent and
access to markets. Post-Brexit Britain
will remain well positioned on all three.
Leaving the EU, though, does change
Britain’s comparative advantages, and
will determine what kind of startups
can thrive in the country’s ecosystem.
London will remain the VC capital
of Europe. According to KPMG, more
than twice as much venture capital
was deployed in the UK as in Germany
in the third quarter of 2018. London
remains the obvious location for inter-
national funds seeking a European HQ, as
SoftBank’s presence in the UK testifies.
Since the referendum, top Silicon Valley
funds have led large investments in
globally ambitious UK companies, from
Sequoia’s $50m funding of Graphcore to
Greylock’s investment in my own firm,
Entrepreneur First. The British Business
Bank – Britain’s state-owned bank tasked
with providing credit for small and
medium businesses – is flush with new
cash, and has picked up much of the slack
left by the European Investment Fund.
Access to talent will be a thornier
matter. The ability for talented softwareMatt Clifford is the chief
executive and co-founder
of Entrepreneur FirstLondon will remain the
VC capital of Europe
Despite Brexit uncertainty, UK tech is booming – but
attracting top talent may be tricky in the long runengineers from across Europe to join
and contribute to UK startups has been
crucial in enabling the UK’s tech boom
over the past few years. The approaching
end of freedom of movement for EU
citizens is a major blow, and one the
tech sector will not escape.
Yet UK tech will likely still be able to
attract talent, particularly at the highest
skill levels. That is for two key reasons.